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Charlie Has a Utility Function U(xA, XB) = XAxB, the Price

Question 45

Multiple Choice

Charlie has a utility function U(xA, xB) = xAxB, the price of apples is $1, and the price of bananas is $2. If Charlie's income were $120, how many units of bananas would he consume if he chose the bundle that maximized his utility subject to his budget constraint?


A) 30
B) 15
C) 60
D) 6
E) 90

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